|Good times rolling for government employees
Compensation for Michigan's private sector citizens decreased by 10.3% between 2007 and the third quarter of 2009 - the most recent data available from the federal Bureau of Economic Analysis. Most Michiganders are earning less and struggling to get by.
But one group is actually becoming richer in Michigan: government employees. State and local government employee compensation increased by 5.5% during the same period, and federal employee compensation is up by 7.5%.
And the good times will keep rolling for state government bureaucrats who are scheduled to receive a nice 3% pay increase this year unless two-thirds of state lawmakers vote to halt the pay hike.
Who pays for generous government employee pay increases in these tough times? Remember that Governor Granholm and state lawmakers hiked the state income tax by 12% and the state business tax by 22% back in 2007? Those tax hikes meant more money out of your shrinking paycheck and into the fatter paychecks of Michigan's government class.
This year, Governor Granholm needs even more money to afford her proposed state budget - which includes the state employee pay increase. So Granholm is pushing a plan that would lower the sales tax from 6% to 5.5% but extend the tax to a whole slew of new purchases currently exempt from the sales tax - things like hair cuts, oil changes, carpet cleaning, yard mowing, pet grooming and thousands of other services. This sales tax extension would take another $550,000,000 out of citizens' pockets in 2011 and transfer that money to Lansing.
Lawmakers supporting this year's state bureaucrat pay increase argue that state employees "have suffered enough" in recent budgets. But the government's own statistics show the opposite to be true: taxpayers have suffered far more than "enough" while government employee pay and benefit levels keep rising.
The U.S. Bureau of Labor Statistics documents that government employee benefits cost twice as much as full-time, private sector benefits. What accounts for the difference? Consider the jackpot benefits that many government employees receive:
• Public school employees contribute an average of 4.2% to their health care plans while private sector citizens pay an average of 22% of their own health care costs.
• Expensive "defined benefit" retirement plans are almost non-existent in the private sector, but are commonplace for public school, public university and local government employees.
• Macomb County government employees enjoy a taxpayer-paid retirement benefit that allows many to retire at the age of 50!
There was a time when government employees enjoyed better benefits and job security than most taxpayers, but were paid less than comparable private sector employees. Not anymore. Statistics from the Bureau of Labor Statistics document that today, the government class enjoys higher salaries, richer benefits and far better job security than the citizens they are supposed to be serving.
It shouldn't surprise anyone that government employees are much more bullish about the economy than private sector employees. A national poll conducted in December by the survey firm Rasmussen Reports found that 24% of government employees rated the economy as good or excellent while just 9% of those in the private sector were so upbeat.
The 'public servants' have become the masters over taxpayers. And it is costing your family plenty.
Back to home page